Tether [USDT] token release worth $250 million incites investors to await Bitcoin [BTC] price hike
Tether [USDT], an emerging start-up in the domain of cryptocurrency, releases new tokens worth $250 million. The declaration by Tether [USDT] on the issuance of new tokens for circulatory purpose was made on Monday, 25th June, 2018. According to a report by BCFocus, Tether [USDT] and another crypto coin Ethereum Classic [ETC] as trading pairs get recently launched on Binance platform.
It is anticipated that this new release of tokens would positive affect the Bitcoin [BTC] price. In a number of cryptocurrency exchange platforms, Tether [USDT] crypto coin becomes a substitute to dollars. This is because there are times when crypto exchanges find it problematic to secure good bonding with the bank.
The sole purpose for the requirement of a stable relationship with the bank is for holding fiat currencies for customers’ sake. In a ratio of 1 to 1, Tether [USDT] crypto coin is backed by U.S. dollar. In the last 24 hours, the trading volume price of Tether [USDT] is marked at $4.2 billion. In the list of all digital currencies, Bitcoin [BTC] holds the top most position which is immediately followed by Tether [USDT].
With the release of new tokens by Tether [USDT], inflow of new capital in the crypto market takes place. The underlying reason for this capital inflow is the company policy. It says that organisations can issue tokens when physical dollars are deposited into the bank accounts of Tether [USDT].
As a result, the release of new tokens can pull up the price of Bitcoin [BTC] and create a bullish market scenario. In just a period of 24 hours, the new token release started influencing the Bitcoin [BTC] price. Since yesterday, the price valuation of Bitcoin [BTC] upsurged by nearly 6% with a trading volume of around $6,270. However, since the crypto market condition at present time is extremely unstable and uncertain, hence the hike percentage may not sustain for a long time.
However, it needs to be taken into consideration that the owner can possess the cryptocurrency as long as he wishes before trading. Since 18th May, 2018 this event of new release of $250 million Tether [USDT] tokens on Monday is, indeed, the first to happen. With that release,even Bitcoin [BTC] price in the crypto market was positively affected.
In the following days, the Bitcoin [BTC] valuation appreciated. From the time period of 18th May to 21st May, the price hiked from mark of $8,100 to $8,500. Once again this price upsurge of Bitcoin [BTC] could not last long and drastic downfall followed. In the following weeks, the price of Bitcoin [BTC] steeply declined exceeding an amount of $2,300.
In the mid-week of June, a report was released by Sporkin & Sullivan LLP (FSS), a legal firm. In the report, the firm clarifies that physical dollars back Tether [USDT] stored in the bank accounts of Tether [USDT]. The report does not present a full auditing, however, it does assist to negate the charges against the company. The company was alleged to operate fractional reserve utilising tokens which are not backed. This was meant for manipulating the Bitcoin [BTC] price valuation at the significant moments of market fluctuation.
At the present moment, the market cap in circulation exceeds $2.6 billion, thereby, becoming 11th largest virtual currency. The “Transparency” page of Tether [USDT] states that the total amount of holding the firm possesses exceed $3billion in the accounts of reserve bank. This is, indeed, an explicit implication that the firm can release new tokens worth nearly $400 million.
Social Media Post
Charlie Lee, the creator of Litecoin [LTC] after the issuance of new $250 million worth tokens, posted his opinion on Tweeter. In the post, he compared the release of Tether [USDT] with the event of capital inflow in exchange platform by depositor. Therein, the funds are present however, the manner and timing of distribution could lay an impact on the market. However, the investors are now patient enough to wait for the influence of this release on Bitcoin [BTC] price.
Generally, this has been a precursor of price going up. Tether gets printed when people deposit USD and get USDT back. This USDT will then be used to buy crypto. This is similar to someone depositing $250MM to exchanges. Of course, that doesn’t mean they will buy right away. DYOR https://t.co/zg2PEjGohv
— Charlie Lee [LTC⚡] (@SatoshiLite) June 25, 2018
Image via Shutterstock
Join our Telegram group